China is set to implement a series of incremental measures to stabilize its property sector, said Ni Hong, minister of Housing and Urban-Rural Development, at a press conference in Beijing on Thursday.
The event featured officials from the Ministry of Housing and Urban-Rural Development alongside representatives from the Ministry of Finance, the Ministry of Natural Resources, the People's Bank of China, and the National Financial Regulatory Administration.
Policies to prop up the property sector
The government will step up support for urban village and dilapidated housing renovation projects, Ni said, adding that China will complete the renovation of an additional 1 million such housing units by providing monetary compensation to residents.
The minister emphasized that all eligible real estate projects will be included in the "white list" mechanism, to ensure that their reasonable financing needs are met through loans.
As of October 16, loans approved for the "white list" real estate projects had reached 2.23 trillion yuan (about $313.11 billion), according to Xiao Yuanqi, deputy head of the National Financial Regulatory Administration.
Xiao further indicated that the approved loan amount for "white list" projects is expected to double to over four trillion yuan by the end of this year.
Officials introduce relevant information on promoting development of the housing market at a press conference in Beijing on October 17, 2024. /CFP
Financial support and monetary policy measures were also announced during the press conference to aid stabilization of the property sector.
Song Qichao, assistant minister of finance, noted that local governments will have the autonomy to decide on the acquisition of existing residential properties using special bonds. The government is also actively pursuing adjustments to real estate value-added tax policies to alleviate burdens on both businesses and homebuyers.
In a related development, the People's Bank of China (PBOC), the country's central bank, is exploring options to provide loans to qualified enterprises for acquiring idle land to support market recovery, according to Tao Ling, vice-president of the PBOC.
Housing market in major Chinese cities heating up
Home sales in major Chinese cities are rising in October, following a directive from Chinese authorities in late September to cut mortgage rates for existing loans, lower down payment ratios, and relax purchase restrictions. The cities of Beijing, Shanghai, Guangzhou, and Shenzhen introduced their own stimulus measures for local housing markets just before the National Day holiday.
The moves followed a meeting of the Political Bureau of the Communist Party of China Central Committee, which emphasized the need for efforts to reverse the downturn in the real estate market and stabilize it.
People at a property sales office near the Future Science City in suburban Beijing, October 5, 2024. /CFP
These measures have quickly proven effective in boosting homebuyer sentiment in large cities. Many housing sales centers in these urban areas are bustling with clients, as previously hesitant homebuyers are now re-entering the market.
"Recent observations indicate a pickup in housing market activity, particularly in first-tier cities," Bruce Pang, chief economist of JLL Greater China, told CGTN. He added that it will take time for improvements in sales volumes and prices to translate into property investments and construction.
Cities beyond the first-tier ones have also taken action, with over 50 cities—including Wuhan, Nanchang, Hefei, Hangzhou, and Chengdu—implementing measures to reduce mortgage rates, lower down payments, eliminate restrictions on the transfer of commercial housing, and enhance purchase subsidies.
Pang emphasized that policymakers are adopting a more pragmatic approach to the property sector, aiming to make it a stabilizer for economic growth rather than a primary driver.